Baytex Energy (NYSE: BTE) reported Q1 FFO of Cdn$0.24, versus Cdn$0.40 reported last year.

2020 Outlook

We previously announced a 50% reduction in our capital spending for this year to $260 to $290 million, from $500 to $575 million. With this revised capital program, we have suspended drilling and completion operations in Canada and expect to see a moderated pace of activity in the Eagle Ford. We are also intensely focused on driving further efficiencies in our operations. We have taken actions to achieve $135 million of cost reductions for 2020 relating to operating, transportation and general & administrative expenses.

In order to optimize the value of our resource base, we are voluntarily shutting-in approximately 25,000 boe/d of production (3,500 boe/d previously) of which 80% is heavy oil. At current commodity prices, the shut-in of these barrels will have a positive impact on our adjusted funds flow and improve our financial liquidity. Our current expectation is that the majority of these volumes will remain off-line for the balance of this year. Should operating netbacks change, we have the ability to shut-in additional volumes or restart wells in short order. Taking into account the incremental shut-in volumes, we have revised our production guidance range for 2020 to 70,000 to 74,000 boe/d, from 85,000 to 89,000 boe/d previously.

The situation around the COVID-19 virus continues to evolve. We have implemented a number of measures to foster resilience through these unpredictable times, including a work-from-home program and altering shifts in the field. We are focused on protecting the health and safety of our personnel while maintaining our operations and, to date, have had no positive cases of COVID-19 within the company.

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